Protesters brandish a photograph of the Russian oil boss Mikhail Khodorkovsky during a rally in St Petersburg on Sunday. Photograph: Anatoly Maltsev/EPA

Russia faces one of the biggest judgments on the Putin-Medvedev leadership tomorrow with the culmination of the latest legal case against Mikhail Khodorkovsky, the oil billionaire and one-time political contender who has been in jail on fraud charges since 2003.

The case against Khodorkovsky, once Russia's richest man, has been seized upon as a barometer of Russia's political climate. Another lengthy jail term for the man once seen as a threat to Vladimir Putin's pre-eminence is likely to indicate a further retrenchment of the forces of Soviet-style justice hostage to the whims of its leaders; a lesser verdict — or an unlikely acquittal — will be seen as a victory for forces of reform.

The case is the second against Khodorkovsky and his former business partner Platon Lebedev, who were dramatically arrested in 2003 and convicted of fraud and tax evasion two years later. Khodorkovsky's oil empire, built up through the corrupt privatisation auctions in the 1990s, was crudely appropriated and appended to the apparatus of the state. But from his jail cell in Siberia, and latterly Moscow, the former tycoon has grown into an unlikely figurehead for the fractured and emasculated opposition in Russia.

The latest case against the pair was brought in 2007, when prosecutors presented fresh charges against the two men, this time for allegedly embezzling over 200 million tonnes of oil and laundering the proceeds. Throughout the trial Khodorkovsky would point to the absurdity of the two cases: evading taxes on laundered money does not make much sense.

The trial has lasted nearly two years. The prosecutor spent several months reading the 3,500-page indictment in a low mumble. More than 100 witnesses were called. In a surprise move, former economy minister German Gref and energy minister Viktor Khristenko agreed to testify.

Throughout the trial Khodorkovsky has often appeared frustrated, as he leads his own defence despite a team of lawyers. His closing remarks early last month were greeted in some circles as a manifesto for challenging the Putin era.

"A state that destroys its best companies, which are ready to become global champions, a country that holds its own citizens in contempt, trusting only the bureaucracy and the special services, is a sick state," Khodorkovsky told the court.

"Much more than two people's fates lie in your hands," he said. "Right here and right now, the fate of every citizen of our country is being decided." That was a thought echoed today in an open letter to President Medvedev, signed by nearly 50 European figures, including former foreign secretary David Miliband, former French foreign minister Bernard Kouchner, and film director Terry Gilliam.

"As strong supporters of the drive to modernise Russia we cannot stand idly by when rule of law and human values are being so openly abused and compromised," they wrote about the trial of Khodorkovsky and Lebedev. "The consensus of respected objective observers is that their ongoing persecution is unjust and not truly motivated by law. This has shaken confidence in the Russian legal system and in your strong will to uphold the Russian constitution."

Medvedev, a former lawyer, took over the Kremlin from Putin nearly three years ago, and has focused his presidential rhetoric on pledging to modernise and democratise the country. In practice, he has done little to suggest that he operates independently of Russia's paramount leader.

Friends and associates consider the perpetual assault on Khodorkovsky as a deliberate attack on a man who had grown too powerful and too independent for Putin. Mikhail Kasyanov, who served as prime minister under Putin and has since joined the opposition, says Putin once told him that it was Khodorkovsky's funding of the parliamentary opposition without Kremlin approval that had sealed his fate. He spent two years in a jail in Chita in the Siberian far east, some of it in solitary confinement, before being transferred to Moscow in 2007.

Khodorkovsky's supporters argue that the second trial, which could see him jailed until 2017, was designed to keep him in prison throughout the election period. His current sentence runs out in October 2011.

Vadim Klyuvgant, Khodorkovsky's lead lawyer, declined to speculate on what sort of verdict he expected, but said the judge had come under unprecedented pressure and that both trials taken together amounted to "one big vendetta".

The verdict could be read out over several days. At the end of Khodorkovsky's first trial in 2005, the judge took 10 days to issue his decision, gracing the court with an endless litany of procedural remarks. "Khodorkovsky is ready for everything," Klyuvgant said. "He's ready to fight as long as needed."